How I Transformed My Money Mentality to Boost My Income by 23%
Earning money is a touchy subject in Canada. Asking how much someone earns is generally considered a faux-pas. And discussions about how much you earn and therefore how to maximize your earning potential are few and far between – even between couples. A CIBC survey found that only one-third of couples discuss money before marriage, even though 99% of those surveyed agreed that money should not be a taboo subject.
If it’s that hard to discuss your money with your partner, talking about how much you earn with others must fall somewhere between discussing digestive upset and telling your best friend where you hid a body.
Because of our secretive tendencies around money, many Canadians aren’t paid what they’re worth, particularly women. Women are less likely to negotiate their job offers, which can hinder earning power for years.
I’m not immune to this phenomenon. Despite being part of the personal finance community and knowing that earning more money was key to a prosperous financial future, I fell victim to the classic scarcity money mindset.
The scarcity mindset
The scarcity mindset traps you into thinking that there is only so much money coming your way, so you should be grateful for it and not rock the boat and hoard it all because you never know when the faucet will be turned off.
Living with a scarcity mindset has a detrimental effect on your finances in many ways. For me manifested in low-balled job offers (which meant it was almost impossible to catch my pay up to market rate without significant raises), I experienced intense anxiety when it came to asking for raises, and I hesitated to spend money improving my skills because I was constantly worried about paying my bills.
It took me several years before I was able to change my money mindset permanently. Here’s what I did, and the fantastic results that I achieved:
I Started Freelancing
The first and most important step I took towards changing my money mindset was that I started freelancing. As a content marketer, there was no shortage of demand for my skills, and over the course of several years, I established enough clients to fill my plate, steadily bringing in as much as 50% of my full-time gross income. Freelancing changed my money mindset in two key ways:
First, freelancing gave me an additional income to fall back on. This additional income meant that I wasn’t so dependent on my full-time job and I didn’t have to live in perpetual fear of being laid off. If I did lose my job, I had options.
Second, freelancing allowed me to sharpen my skills and understand what the market rate was for those skills. I had plenty of opportunities to practice negotiating and justifying my rates, which I applied to my salary negotiations at my full-time job.
I Invested in Myself
When I was living with a scarcity mindset, I was nervous to spend money on improving my skills because, in my mind, that money was for saving or paying off debt or otherwise bettering my financial situation. Investing in myself seemed like an extravagance.
What I didn’t understand at the time was that the better my skills, the more money I would earn, and the more money I would have to send towards my financial goals. At first, I improved my skills using free courses and training webinars, and once I saw the financial return on investment from those free resources, I moved on and invested money in my skill set to grow both my full-time income and my freelance income.
I Treated Myself Like a Business
Instead of just going to work every day and hoping that my boss would notice my contributions and reward me financially (which isn’t a good strategy, for anyone who is wondering) I started to treat myself like a business. I had income and expenses, and a finite number of hours in the day. To maximize my income, I needed to maximize my productivity during the hours I spent working. Instead of wasting my skills on tasks that could be outsourced to anyone, I focused on tasks within my niche. My results improved, and my profitability skyrocketed.
By solidifying my niche, I was able to show my value to my employer and my freelance clients, which allowed me to raise rates across the board.
The Final Word
In the end, by leaving my scarcity mindset behind and adopting an abundance mindset instead, I learned to invest in myself, grow my freelance business, and find the confidence to ask for what I was worth at my full-time job. Because of these changes, I’ve been able to increase my income by about 23% in the past two years. It wasn’t easy, and it involved some uncomfortable conversations about my pay with both my bosses and freelance clients – but it was worth it!
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